Survey: Pension Plans Searching for Higher Performance

FOR IMMEDIATE RELEASE
June 10, 2005

Major pension investors are actively using and exploring expanded investment opportunities to meet return requirements in this low-return environment, according to a new survey conducted for JPMorgan Asset Management by Schulman, Ronca & Bucuvalas, Inc. (SRBI).

The JPMorgan Asset Management New Sources of Return Survey for 2005, examined the investment practices of 120 of the largest 350 defined benefit pension plans in the U.S., both public and corporate, accounting for over $1.2 trillion in plan assets.

When these chief investment managers were asked what they see as their greatest challenge when considering the future performance of their plans, a strong consensus formed around an overriding concern - achieving target returns in a low-return environment. Asset liability risk management and improving or maintaining funded status were also cited. This is not surprising, given that:

• Over 50% of plans categorized themselves as less than 95% funded (42% of corporate and 68% of public plans).
• Average portfolio allocations are similar for public and corporate plans, with both maintaining a mix of approximately 63% equity/27% fixed income/10% alternatives.
• Plan sponsors’ median expected 3-5 year return on assets is a modest 8.0% (8.4% for corporate and 7.5% for public plans).

Key findings from the full research report are highlighted at:

http://jpmorganfleming.chase.com/imweb/impub/NSR_US_summary.pdf

Abt SRBI is a full-service international market and opinion research firm. Founded in 1981, SRBI specializes in banking and finance, public policy, consumer products/services, media, telecommunications, transportation, utilities, and health care research.

Abt SRBI conducted the survey of senior investment managers by telephone February 2 - 23, 2005. The sample, provided by JPMorgan Asset Management, included clients and non-clients.